Revenue Recognition. Renee Rampulla
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Название: Revenue Recognition
Автор: Renee Rampulla
Издательство: John Wiley & Sons Limited
Жанр: Бухучет, налогообложение, аудит
isbn: 9781119763925
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ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus agent considerations (Reporting Revenue Gross versus Net)
This ASU clarifies implementation guidance related to principal versus agent transactions within the scope of FASB ASC 606; specifically, when another party, in addition to the entity, is involved in providing a good or service to a customer. An entity’s determination of whether it is a principal or agent depends on whether the entity obtains control before transferring the good or providing the service to a customer. Amendments in this ASU provide indicators of control and helpful illustrative examples. Clarifications brought about by the issuance of this ASU correspond to the applicable existing transition and effective dates of ASU No. 2014-09.
ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying performance obligations and licensing
FASB issued this ASU to reduce the potential for diversity in practice at the initial application and transition to FASB ASC 606, and to reduce the cost and complexity of applying FASB ASC 606 on an ongoing basis. Specifically, this ASU clarifies guidance for identifying performance obligations and for licensing implementation.
Identifying performance obligations — Under the amendments, entities are not required to assess whether promised goods or services are performance obligations if they are immaterial to the contract. In addition, entities may elect to account for shipping and handling activities as an activity to fulfill promises within the contract rather than as an additional promised service. The ASU also improves guidance on assessing whether promised goods and services are distinct.
Licensing — With regards to licensing, the ASU clarifies whether revenue should be recognized at a point in time or over time, based on whether the license provides a right to use an entity’s intellectual property or a right to access the entity’s intellectual property.
Lastly, clarification on implementation guidance on recognizing revenue for sales-based or usage-based royalty promised in exchange for a license of intellectual property is provided.
Any changes brought about by the issuance of this ASU correspond to the applicable existing transition and effective dates of ASU No. 2014-09.
ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-scope improvements and practical expedients
The ASU includes narrow-scope limitations and practical expedients for the following topics:
Clarification on contract modifications: An entity is permitted to determine and allocate the transaction price on the basis of all satisfied and unsatisfied performance obligations in a modified contract as of the beginning of the earliest period presented in accordance with the guidance in FASB ASC 606. An entity would not be required to separately evaluate the effects of each contract modification. An entity that chooses to apply this practical expedient would apply the expedient consistently to similar types of contracts.
How to assess the collectability criterion: An entity should assess the collectability of the consideration promised in a contract for the goods or services that will be transferred to the customer rather than assessing the collectability of the consideration promised in the contract for all of the promised goods or services.
How to report sales taxes and similar taxes. An entity may make an accounting policy election to exclude from the measurement of the transaction price all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue producing transaction and collected by the entity from a customer (for example, sales, use, value added, and some excise taxes). Taxes assessed on an entity’s total gross receipts or imposed during the inventory procurement process should be excluded from the scope of the election. An entity that makes this election should exclude from the transaction price all taxes in the scope of the election and should comply with the applicable accounting policy guidance, including disclosure requirements.
When to measure noncash consideration. This ASU clarifies that the measurement date for noncash consideration is contract inception. If the fair value of the noncash consideration varies because of the form of the consideration and for reasons other than the form of the consideration, an entity should apply the guidance on variable consideration only to the variability resulting from reasons other than the form of the consideration.
How to apply transition guidance. This ASU clarifies that a completed contract for purposes of transition is a contract for which all (or substantially all) of the revenue was recognized under legacy GAAP before the date of initial application. Accounting for elements of a contract that do not affect revenue under legacy GAAP are irrelevant to the assessment of whether a contract is complete. In addition, an entity is permitted to apply the modified retrospective transition method either to all contracts or only to contracts that are not completed contracts.
The effective date of this ASU corresponds to the applicable effective dates of ASU No. 2014-09.
ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers
A number of suggested improvements to FASB ASC 606 were brought to FASB’s attention; as a result, this ASU was issued to provide very narrow clarification for the following specific situations:
Loan guarantee fees: The ASU clarifies that guarantee fees are within the scope of FASB ASC 460, Guarantees (other than product or service warranties), and not within the scope of FASB ASC 606, and that entities should refer to the guidance in FASB ASC 815, Derivatives and Hedging, for guarantees that are accounted for a derivative.
Contract costs impairment testing: This clarification addresses impairment testing of costs capitalized in accordance FASB ASC 340-40 and explains that when performing impairment testing, an entity shouldconsider the expected contract renewals and extensions, andinclude both the amount of consideration it has already received but has not yet recognized as revenue and the amount it expects to receive in the future.
Contract costs—Interaction of impairment testing with other guidance in other FASB ASC topics: This clarification explains that impairment testing first should be performed on assets not within the scope of FASB ASC 340, Other Assets and Deferred Costs; FASB ASC 350, Intangibles—Goodwill and Other; or FASB ASC 360, Property, Plant, and Equipment (such as FASB ASC 330, Inventory), then assets within the scope of FASB ASC 340, then asset groups and reporting units within the scope of FASB ASC 360 and FASB ASC 350.
Provisions for losses on construction-type and production-type contracts: This ASU requires that the provision for losses on construction-type and production-type contracts be determined at least at the contract level and that an entity would be allowed to make an accounting policy election to determine the provision for losses at the performance obligation level.
Scope of FASB ASC 606: Removed the term “insurance” from the scope exception of FASB ASC 944, Financial Services—Insurance, to clarify that all contracts within the scope of FASB ASC 944 are excluded from the scope of FASB ASC 944. This was done to in order to exclude other types of contracts in FASB ASC 944, such as investment contracts that do not subject an insurance company to insurance risk.
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